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In recent years, affected by rising raw material prices, the price of power batteries has continued to rise sharply. However, with the deployment of power batteries by car companies and the expansion of production capacity of power battery companies, battery prices are gradually returning to rationality.
As China's power battery vehicle industry's demand for various battery materials has increased by 100%-150% in 2021 and 2022, the supply of battery raw materials was once in short supply. For this reason, related upstream industries such as battery raw materials have increased the production capacity of raw materials, which not only greatly alleviated the shortage of battery raw materials, but even caused an oversupply situation. Even if the demand for battery raw materials will continue to increase in 2023, the price of battery raw materials will most likely decline.
1. The market demand is strong and battery raw materials price fluctuates
According to public information, on September 21, 2020, the spot price of battery-grade lithium carbonate once fell to 40,000 RMB/ton. Subsequently, its price began to rise continuously. In 2022, the price was even close to 600,000 RMB/ton. The price of lithium carbonate, a raw material for power batteries, has risen from 50,000 RMB/ton to 500,000 RMB/ton, and its fluctuations have affected the development of China's new energy automobile industry. Data show that the cumulative sales of new energy vehicles in China will reach 5.674 million in 2022, a year-on-year increase of 90.0%, exceeding market expectations.
The data shows that in 2022, global sales of new energy vehicles will reach 10.824 million, a year-on-year increase of 61.6%. The rapidly growing sales of new energy smart cars has also increased the demand for elements such as chips and batteries, and the industry was once faced with the situation of "lack of batteries and expensive cells". With the rapid growth of new energy vehicles, the shipments of power batteries are also growing rapidly. According to experts, the current price of lithium carbonate has partially fallen, mainly due to two reasons:
- One is the change in the relationship between supply and demand. The cyclical impact of the slowdown in the production growth of new energy vehicles has affected upstream raw materials, and the market demand has dropped compared to the present.
- On the other hand, the proven reserves of lithium mines in China have been further expanded, the technology for extracting lithium from salt lakes has been gradually improved, and the pre-industrialization of lithium extraction in mines has been solved to a certain extent.
Regarding the reasons for price fluctuations, experts believe that lithium carbonate price fluctuations are mainly affected by factors such as demand growth, international friction, and capital speculation. On the whole, in 2023, due to factors such as the weak global economy, sluggish international demand, lower market growth expectations, and China's strengthening of key strategic resource reserves, the price of lithium carbonate is expected to stabilize and decline.
2. Experts expect power battery prices to return to rationality
In order to win business orders, the lithium battery companies in the world is also actively expanding production. In January 2023 alone, many battery companies will promote the construction of battery factories with a high profile. The power battery welcomes the expansion of production. According to estimates, in 2023, the global lithium resource end is expected to release 352,000 tons of new production, basically meeting demand. Professionals said that according to current market feedback, there is a high probability that the price of waste recycling will drop, but the speed and depth of the drop depend on the growth rate of new energy vehicles.
From 2023, it is highly likely that the price of lithium battery raw materials will return to rationality, and it will become a trend of steady decline. According to the latest forecast in the industry, the growth of lithium production in 2023 will be between 22% and 42%, with a strong momentum. According to relevant data, the average price of battery-grade lithium carbonate fell by 2,500 RMB/ton to 469,000 RMB/ton on February 1, 2023. The price of lithium carbonate has fallen by nearly 21% from the historically highest average price of 590,000 RMB/ton in mid-November last year.
Experts believe that whether there will be fluctuations in the price of lithium carbonate in the future, the cost of the enterprise and the grade of the mine are all factors that need to be considered, but the overall trend is biased towards rationality. Overall, with the expansion of production capacity, the application of new technologies, and the enhancement of recycling, battery prices will improve in 2023. However, due to the increasing demand for new energy vehicles and the expansion cycle of resources such as lithium mines is about 2-3 years, the final price decline is still uncertain.
2. Power battery companies will meet more opportunities
2023 has arrived, and power battery technology and the industrial chain are also ushering in new possibilities. In 2022, a large number of companies will flood into the power battery related industry. Reflected in the capital market, the stock prices of companies in related fields such as battery raw material mining, battery energy storage, and recycling will also fluctuate rapidly in 2022 and gradually return to rationality. Power battery innovation based on material innovation will continue to promote power battery safety, energy density and volume density improvement, process and manufacturing, cost optimization technology progress + low-carbon green, and the quality of industrial development will be further improved.
Secondly, with the release of the capacity under construction of a number of mainstream battery and material companies, the pressure on the supply of mainstream power batteries will ease, and the price of lithium carbonate will likely drop. In international competition, Chinese enterprises will accelerate their overseas deployment, and their export volume will continue to grow. The share of Japanese and Korean batteries in the domestic market will further decrease. In addition, the government will also pay more attention to the production capacity of power batteries.
In terms of technology, sodium batteries will form a small batch capacity and will be demonstrated in small scenarios. Solid-liquid hybrid batteries have entered the stage of batch loading. Demand for energy storage batteries remains strong. The benign development of power battery recycling companies still faces many challenges. The mass production of 9-series materials for power battery cathode materials is gradually increasing, and most cathode material companies are developing 9-series materials. The competition in the battery industry is intensifying, and the market is gradually returning to rationality. In 2023, major companies will face more opportunities and challenges.
Related articles: power battery companies in the world, battery-grade lithium carbonate companies